Small-Business Groups Hail Executive Order on Eminent Domain

Small-business advocates are voicing their support for an executive order by President Bush that curbs the powers of federal agencies to seize private property for public projects.

The order, which the president signed on Friday, marked exactly a year to the day that the Supreme Court ruled local governments have the right to buy private homes and businesses for the purpose of economic development under the constitutional powers of eminent domain.

Bush moved to limit those powers to instances that clearly benefit the general public and "not merely for the purpose of advancing the economic interests of private parties to be given ownership or use of the property taken," the executive order said.

The president also directed the attorney general to monitor its use by federal agencies.

Last year, the Supreme Court ruled against 15 residents and investors who were forced to sell their properties to the city of New London, Conn., to make way for a research facility owned by Pfizer.

Karen Kerrigan, president of the Small Business & Entrepreneurship Council, a Washington-based policy watchdog group, described that decision as shocking and a "grave assault on fundamental private property rights."

Since the ruling, the House and 23 states have enacted legislation to prohibit the use of eminent domain, while the Senate remains stalled on the issue, according to the SBE council.

"Property owners have every right to own their property without concern that federal government will infringe on their rights," House Speaker Dennis Hastert (R-Ill.) said in a statement following the executive order. "President Bush has built on our efforts to assure American's this basic right."

According to a report by the Institute for Justice, a public policy law firm that argued last year's case before the court, some 5,783 private properties nationwide have been seized, or threatened to be seized, in the 12 months following the ruling, compared to 10,000 over the previous five years.

The Supreme Court decision "emboldened officials and developers" to start new projects and move existing ones forward, Dana Berliner, a senior attorney at the Institute for Justice, said in the report.

The National Federation of Independent Business, a Washington-based lobby with more than 600,000 members, has called eminent domain a serious threat to small business.

"Small businesses should not have to fear that their business could be seized by the government in order to promote increased economic development," said Dan Danner, the group's executive vice president.

While praising the president's move, Danner urged the Senate to "follow the lead of their colleagues in the house and pass legislation on this vital issue."

The order was also supported by farmers and ranchers, who are often the target of land seizures for local development project, according to the American Farm Bureau Federation. "The Farm Bureau appreciates the president taking a stand," AFBF President Bob Stallman said in a statement.